Gold prices dropped on Wednesday morning as the dollar was driven higher by the 10-year U.S. treasury yields that surged to a four-year high at 3%.

Gold futures for June delivery on the Comex division of the New York Mercantile Exchange was down $4.20, or 0.32%, to $1,328.80 a troy ounce by 12:30PM ET (04:30 GMT).

The U.S. dollar index that tracks the greenback against a basket of six major currencies last gained 0.10% to 90.65, another high in one month.

Gold prices slid as the sentiment in Wall Street trade soured amid rising yields. The U.S. 10-year Treasuries yields surged to 3% on Tuesday, a new high since early 2014. The increase was driven by fears of rising inflation and speculations that the Federal Reserve will be more aggressive in raising interest rates in 2018.

Higher yields could lead to reduced spending that would push stocks lower. All major indices in the U.S. experienced significant drops Tuesday as the yields on 10-year Treasuries topped 3%. And falling equity prices were cited supportive for the dollar.

Dollar-denominated assets such as gold are sensitive to moves in the dollar – a gain in the dollar makes gold more expensive for holders of foreign currency and thus decreases demand for the precious metal.